Exit Management for Banks and NBFCs: Handover and Dues

When someone leaves a lender, the risk is not the empty chair but what could walk out with it: keys, cash, receipt books, system access and relationships with borrowers. Good exit management records the resignation and last working day at once, plans the handover of desk and portfolio, removes access on the last day, clears every department, and pays wages due within two working days of the exit.

Notice periods that suit the role

Notice periods in lending usually rise with responsibility: 30 days for field and operations staff, and 60 to 90 days for branch managers, credit heads and senior officers whose handover takes longer. Keep a shorter notice during probation. When a resignation arrives, record it the same day so the last working day is fixed and the employee moves to on notice, which tells the branch manager and payroll that the exit clock is running.

Handover of desk, keys and portfolio

A loan officer's centres, a collection executive's allocation and a cashier's keys all need a named successor before the last day. For field roles, the outgoing and incoming officers should visit centres or key borrowers together, so customers know whom to pay next month. Receipt books come back and are reconciled, and any cash in hand is deposited against a receipt.

Cash in hand deposited and receipt books reconciled
Vault, locker and dual-control keys handed over with a register entry
Centres or collection allocation transferred through joint visits
Loan system, core banking and email access removed on the last day
ID card, phone and tablet returned

Clearance and settlement

Clearance runs through the branch, operations, IT, admin and finance. Finance confirms any salary advance, festival advance or staff loan balance. Payroll then adds pay for days worked, leave encashment where the policy allows, and any incentive earned for the last month, and records recoveries such as a notice pay shortfall as the appointment letter provides. Wages due must reach the employee within two working days of the exit, so start clearance during the notice period, not on the last day. The full and final settlement process sets out the steps.

Worked example: gratuity for a branch manager

A branch manager leaves after 7 completed years of continuous service, with last drawn basic plus DA of ₹26,000 a month. Gratuity is due because service is over five years, at 15 days' wages for each completed year. On the usual 26-day basis, 15 days' wages come to ₹26,000 x 15 / 26 = ₹15,000. For 7 completed years, gratuity is 7 x ₹15,000 = ₹1,05,000. The gratuity calculator gives the same result.

How to set it up in ZeniaHR

Record the resignation on the employee record so the last working day is set and the status moves to on notice.
Set notice days in probation and after confirmation in the work terms policy, with per-grade overrides for branch managers and senior officers.
Use the 8-item exit checklist to track handover, keys, assets and access removal, and choose one of the 20 structured exit reasons.
Enter leave encashment, the final incentive and advance recovery as payroll inputs, and run an off-cycle payroll so wages due are paid within two working days.
Check the gratuity and settlement reports before finance releases the payment.
Review exit reasons by branch every quarter to find branches where field staff leave faster than elsewhere.

Read more about employee records and exits in ZeniaHR.

Employee records and exits

Roles this applies to

KYC Executive Collections Tele Caller Head of Credit Head of Collections Compensation and Benefits Executive

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Frequently asked questions

What is the notice period in NBFCs?

It is set by each NBFC's policy and appointment letter. A common pattern is 30 days for field and operations staff and 60 to 90 days for branch managers and senior roles, with a shorter notice period during probation. Record the resignation as soon as it arrives so the last working day is fixed.

How soon must a bank pay dues to an employee who resigns?

Wages due must be paid within two working days of the employee leaving, whatever the reason for leaving. Gratuity, where due after five years of continuous service, is 15 days' wages for each completed year on the last drawn wages. Start clearance during the notice period so finance can meet the timeline.

What happens to staff when an MFI closes a branch?

Staff can be transferred to other branches where their terms allow it. If a worker with at least one year of continuous service is retrenched, the lender must give one month's written notice with reasons or wages in lieu, and pay compensation of 15 days' average pay for each completed year. Plan transfers first.